Tale of Two Corruptos: Brazil and Mexico on Different Transparency Paths

Mexico complains, often rightly so, about being overshadowed by Brazil, but Transparency International's Corruption Perceptions Index is one more reminder of how Latin America's two titans differ today

There is an increasingly heated debate today about Latin America’s two titans: Does Brazil receive too many kudos, and does Mexico receive too much criticism? For all the ugly press Mexico’s murderous drug war gets, Brazil’s homicide rate is actually higher. Global media fawn over Brazil’s economic boom, but the World Bank finds Mexico a much easier place to do business; it earns more in manufacturing exports and is enrolling a higher number of engineering students.

But Transparency International offers another potential reminder of why Brazil has realized more development, and two times more average economic growth, than Mexico has so far in the so-called Century of the Americas. Bottom line: business and bureaucracy might be easier in Mexico, but in Brazil they’re actually cleaner. Transparency, the Berlin-based corruption watchdog, issued its annual Corruption Perceptions Index this week — and despite Brazil’s long reputation for sleaze, it places ninth among the 26 Latin American and Caribbean countries on the 176-nation Index (the higher ranking being the less corrupt) compared with Mexico’s 16th-place finish. Among all nations, Brazil is No. 69; Mexico is No. 105.

That’s significant because one of the Index’s biggest stories in recent years is that Latin America has begun to shed its centuries-old image as the most venal region on earth. More than half of the Latin American nations ended up in the top half of the Index again this year — and Chile and Uruguay, which tied at No. 20, are just one slot behind the U.S. (Canada, home of Dudley Do-Right, is No. 9, the best in the western hemisphere; Denmark, Finland and New Zealand tied for No. 1.) The fact that Brazil has brought itself more in line with that trend than Mexico has — when at the turn of the century Brazil was still known for its Trem da Alegria, or Joy Train, the sardonic name Brazilians gave their hyper-embezzling public bureaucracy — simply gives global media another excuse to fawn.

Not that Brazil deserves any standing ovation. Its mensalão scandal, which involved millions of dollars in bribes to members of Congress and finally resulted this year in the largest corruption trial in Brazil’s history, is ample evidence of how far the South American giant still has to go. But the fact that the 38 defendants were tried at all — and that most of them, including José Dirceu, onetime chief of staff to popular former President Luiz Inácio Lula da Silva, have been convicted and face actual prison time — has helped burnish the anticorruption campaign of Lula’s successor, current President Dilma Rousseff.

Mexico, meanwhile, can still look as if it’s in denial about the entrenched corruption that according to the World Bank costs the country 9% of its trillion-dollar GDP each year. Last month the federal anticorruption agency all but absolved Mexican officials and retail giant Walmart — despite deeply detailed evidence published in April by the New York Times that the company had allegedly paid government administrators some $25 million in bribes to unfairly obtain permits and other favors. Little wonder that business monopolies, which can hold market shares as high as 95%, still suffocate Mexico’s economy, or that a dysfunctional justice system can’t rein in narcoviolence.

Mexico’s new President, Enrique Peña Nieto — who insists his Institutional Revolutionary Party has reformed after ruling the country from 1929 to 2000 as a corrupt, one-party dictatorship — has proposed a federal institute to ensure more public-records transparency as well as an autonomous anticorruption commission to be built into the constitution. Unfortunately, special agencies, institutes and commissions aren’t a substitute for functioning judiciaries, whose all-too-frequent absence is still Latin America’s biggest anticorruption challenge. Either way, Transparency isn’t the only organization that has cited Brazil’s new edge over Mexico in this department: in 2010, the Latin Business Chronicle ranked Brazil fifth best among 18 Latin American countries in terms of bribes that companies had to pay for things like permits, tax breaks and favorable court rulings; it ranked Mexico 10th.

If anything, Mexico should look at the top-50 Transparency rankings of Chile, Uruguay and Costa Rica (No. 48) — which not coincidentally are also considered three of Latin America’s best developed countries — as proof that fewer mordidas (or bites, as Mexicans call their quotidian graft) means more pesos. That said, however, while the Transparency Index reflects how far Latin America has come, it also points out how much work it has left to do: while two-thirds of the world scores below 50 on Transparency’s corruption score (0 is most corrupt, 100 is least corrupt), almost three-fourths of Latin America does. That includes the region’s worst performers, Venezuela and Haiti, tied at No. 165.

Venezuela’s socialist President Hugo Chávez rode to power 14 years ago denouncing the oil-rich nation’s epic corruption. But his Bolivarian revolution only seems to have embraced it. Today, Venezuela is more often cited for South America’s worst murder rate, one of the world’s highest inflation rates, negligible foreign investment and a judicial system subject to el comandante’s whims. Latin America is full of leaders who promise to crack down on corruption. What it needs is more leaders who crack down on corruption.

Actually, Mexico's homicide rate surpassed Brazil's in 2011. Furthermore, the homicide rate in Mexico has been increasing steadily since 2006 while Brazil's rate has been declining on a steady downward path. It's been estimated that there will be more than 30,000 homicides recorded by INEGI in Mexico this year. 19 of Mexico's States are under a travel advisory warning from the US.

@ValeRo I am an academic sociologist/criminologist, and I am in the final stages of completing a paper on the interpretation of the homicide rate during the Felipe Calderón sexenio (just completed). My source of data on homicides is from the Medical Forensic reports filed (required by law) and reported to INEGI (the mexican national statistical agency equivalent to the US census bureau or Statistics Canada). There are other reports of homicide that filter out a significant number of homicides because the newspapers (eg Reforma) are trying to provide a count of murders that they think are specifically drug related). But the actual number of homicides during the first 5 years of Felipe Calderóns presidency reached almost 107,000. As of September, there were at least 28,000 recorded homicides in 2012 (from INEGI, and from the Procuraduria, and from several newspaper reports). The national rate of homicide when Felipe Calderon took office had actually declined to an all-time low and sat at about 9 homicides per 100,000. At the time he left office, the actual homicide rate sat at almost (just under) 24 per 100,000. There is not a way of attaching graphics to this note, but believe me— the INEGI data does not lie and it is the most reliable and valid measure of all homicides. My numbers from Brazil are taken from United Nations data and are available online in several places. One place to begin is a Wikipedia site (even though it is Wikipedia — it is actual UN data). Look at the link http://en.wikipedia.org/wiki/List_of_countries_by_intentional_homicide_rate_by_decade and move down the page to Brazil. You will see that there is a declining rate during the first decade of the millenium (it began to decline in the 1990's). The data on this link ends at 2009 where the rate was calculated at 23 per 100,000 and the rates are (200) 30 (2001) 31 (2002) 32 (2003) 33 (2-04) 31 (2005) 29 (2006) 31 (2007) 29 (2008) 30 (2009) 23.

Mexico has contracted with several international public relations firms to distribute statistics that it considers favourable, and has actively worked to "speak well of Mexico" (...this was the name of a program that Felipe Calderón promoted). There are many international news agencies that have simply used the numbers provided by Mexico and fact checkers have not bothered to go back and look at the actual data (readily available online and in international reputable sources).

The Economist data has been questioned publicly on a number of bulletin boards and discussion groups. For instance, visit the Google Group site Fronteralist and search for many discussions about the number of homicides in Mexico and for information about the Economist data.

Again, I apologize for not being able to upload some actual figures... but believe me, the numbers I have cited above are real and are based on reliable data and not on public relations documents circulated by those seeking to minimize the real damage in Mexico.

@joseangeldemty@JDC@ValeRo One should never take joy or be happy when describing high rates of violence and murder. It hurts me to see violence anywhere, especially in countries that have such beautiful and caring people like Mexico and Brazil. They, not me, are the victims of violence and States that do not provide security for its citizens. My data on Brazil is taken from the annual United Nations survey of violence. I copied those numbers directly into my post.

But the point is that it really doesn't make any sense to make the comparisons that are the basis of the original article. Both Brazil and Mexico have homicide rates that are completely out of line with most economically advanced countries. With a few notable exceptions, violence has been declining over time (cf. The Better Angels of Our Nature by Stephen Pinker). In the first comment to my post, someone asked me for my sources and I provided them. If you believe they are wrong, then you should provide reliable sources to discredit my figures.

I made no statement about Brazil's public relations firms. I believe you when you say they also do this. Those firms are used to sell States as investment sites, and they do not necessarily focus on any statistical measures or indicators except the economic ones that attract investors.

@JDC@ValeRo Your numbers are wrong, Brazil shows a homicide rate of 26 in 2010, Mexico shows 18 and then 17 in 2012. There is no data for Brazil in 2011. But no need, just in Rio de Janeiro more than 40 thousand people are killed every single year!.

You said that Calderon has contracted public relation firms, well so has Brazil, and most countries in the world do exactly that, but that has no relation to this discussion. According to you, The Economist magazine ¨has been questioned publicly on a number of bulletin boards and discussion groups¨ , what is that supposed to mean? you have to show data that opposses The Economist findings.

You`re just biased and it hurts you to see that, in fact, crime rates in Brazil are much, more higher than in Mexico.

We should stop with these neo-liberal style analyzes. Corruption is not a key factor to explain the development of a country. In fact, China is a corrupt state, such as were Taiwan and S. Korea when they developed. The real question is whether free market ideology delivers what it promises. Even with widespread corruption, an economic policy aimed at boosting growth and industrialization can achieve its goals. Moreover, let's also mention that the countries with the lowest level of corruption, like Sweden, Denmark and Singapore, have high levels of state intervention.

I would say that rather than looking at Chile or Uruguay as the model for the destination that Mexico should look to Colombia for the path to get there.

Yes, Colombia. Colombia is becoming the new darling in Latin America. In order to deal with both Narco violence and political civil war, Colombia has come very far in development of "the state" in Colombia. Colombia is a place where people can trust the police. I once toured the Palacio Justicio in Monteria and I met several fiscalia, the equivalent of a state's attorney. On the desk of every one was the Penal Code of Colombia and all took create pride in telling me it had been remodeled to be based to American penal codes. The court police which I would assume that are those that exercise warrants and probation or parole violations are known to be incorruptible. Traffic stops by the police are less stressful than those in the US. There is security every where but it is not intrusive.

What it took was a will on the part of the people that they would have good government. Areas of society and the economy that never were under government auspice now are all. There is still places for improvement.

But I would say the better model for Mexico to follow is that of Colombia. No country in the Americas and maybe the world was pushed to brink in narco violence, in corruption, and civil strife. In 2000 it was not certain that the government could beat the FARC much less reduce corruption and improve its government than Colombia was in those days.

And to come back and be where it is today, is remarkable.

I am considering living in one of the two countries. Mexico scares me and I am not a coward. I walk the streets of Cali and Medellin in Colombia at 3 in the morning alone. Few of you would do that. I do not fear the police. I know they are not corrupt and will give me an even break. I do not feel I would be sought out by Colombians to be a crime victim. I wasn't. And things get better in Colombia every year.

I can't say the same thing about Mexico. I feel any foreigner with any level of existence above lower middle class would be a target. I believe the police would target me for extortion. And I do not even feel I would be safe in my home with an immense system of security. If I drove anything other than a beat up used car, I fear I would be targeted for carjacking.

So Mexico should look at what Colombia. Some of the things that happened in Colombia where extrajudicial but when a country is at the break of losing to complete lawlessness and several regions of Mexico have reached that Michocan, for example, Guerro other than a few blocks in Acapulco and Ixtapa, Senora, Chihuahua, then sometimes is better that if the bad guys show a fist, you show a stick, if they show a stick, you show a knife, if they show a knife you show a gun.

So I would say the Mexican people need to do whatever to get control of the country back.

@MarkMinter That's good that things in Colombia have improved. But your comments regarding Mexico are near comical, you start using the words "I feel" and "I believe" that leads me to believe you have not been in Mexico and your opinions are shaped by what you see/read on the news. There's plenty of middle class people that drive decent cars and live comfortably in their homes with out an "immense system of security" as you put it.

I have not been in Mexico. I admit. Not since before 2000 and only in the tourist areas.

I had spent the past month studying moving there. I had started out with a belief similar to what I found in Colombia, the reality was absolutely different than the press coverage and perceptions of the place. When I would say to Americans that I had been in Colombia, they would say "But they kill Americans there." And yes, I found their observations comical.

I commend that you are trying to imbue some truth into what you write, to change the perceptions of Americans and the world about Mexico.

I admit I have fallen prey to the press. I found an article from a few weeks back about a man, a Canadian who had been attacked in his rented apartment in Puerto Vallarta and stabbed 23 times. 23 times. I imagine what that much feel like to be stabbed 23 times. The same apartment had a similar murder occur one year before. The police commented that the neighborhood was close to nightlife.

And I found another article from July about another Canadian retiree in Barre de Navidad, in Jalsico who was found dead, bound to a tree with his belt around his neck, his hands tied behind his back. I assumed he eventually strangled himself because he could no longer stay awake. He died alone, tied to a tree in the middle of the jungle. He made the mistake of driving a 2 year old Jeep Patriot and was on the wrong road at the wrong time. He had been visiting a friend Melaque, about 3 miles away. He was found 3 weeks later.

I have also seen warnings from other Americans that had been in Mexico, one with three different types of police in the same photo and the warning said "They guys in the blue, they will extort you. It is best to avoid them. The guys in the black are better, but there aren't many. The guys in the shorts are hired by Acapulco to assist tourists and they are on your side. But they aren't many of them either and they are limited to the tourist zone. So if at all possible avoid the police in Mexico"

I inquired about driving a car down from the US and the overwhelming comments said to ship it. Any guy that makes a deal with the local authorities can be a cop and they will pull over Americans and expect a bribe. So stay on the tolls roads and carry plenty pesos. Better yet, ship the car and fly. And don't even think about trying to come down with a Surburban or large double cab pickup. These are favored in Carjacking because Narcos like them.

So yes, I am falling prey to fear and press. There is plenty to be had if you look for it. My intent was not so much to indict Mexico but to give an example of looking to a country, Colombia, that pulled itself out of what was considered one of highest levels of corruption in the world to become the darling for foreign investment and a retirement destination for many visitors as opposed to Chile who had no history remotely close to Mexico or Colombia.

For me, Mexico would be a better solution than Colombia. It is closer. It is better integrated with the United States in mail, shipping, phone service, satellite offerings, closer for friends and family, a mere 3 hour plane flight with direct connections to many American cities. The houses are wonderful. There are so many miles and miles of practically undisturbed beach. My fondest dream would be to get a jeep, no top, a backpack with a few clothes and come across in Juarez and start making my way south. I speak Spanish well. I am Texan. And Mexico is in my blood. It is part of who I am.

But I am not alone in this fear. I see the houses in Careyes, houses that would be 20 million in Los Angeles, 10 million in Puerto Vallarta, sit and languish on the market because of the fear of driving that road to Mazatlan to get to the airport. I see the wonderful villas and city houses of San Miguel Allende stay and stay on the web sites of Sothebys. I see more and more country properties, haciendas, ranchos that will not sell because people are afraid to be alone in the middle of nowhere.

I see the president of Mexico have to practically impose martial law on Guerro to insure the safety of even Mexican citizens, even within the few blocks of the beach in Acapulco. I see the travel warnings that say "Maybe it is better to fly in Ixtapa or Acapulco not drive. To avoid going north of Tepic. or south of Manzanillo.

Yes, I see the incidents have fallen in Guerro since 2011. I see things are getting better and one side of me wishes to look beyond the drug violence as something that will pass, that Mexico will gain control, and yes, I would like to be one of first Americans back into the country and say to the others, "You are as safe in Mexico as you are in your city in America". There are excellent values to be had, beautiful lives, wonderful ways to live.

It was those guys, those two Canadians that zinged me. Retirees that were targeted because they were NorteAmericanos, targets of opportunity. Random, yes, but targets never the less.

Yes, one side of me says "Maybe those people that were killed were doing something they should not have been doing and if you live a normal life, that you abstain from vice, from drugs, from dishonest dealings then you have nothing to fear"

I want to believe you. It is my best interest to believe you. So keep doing what you are doing. Make me believe the police and the Mexican government have my best interest and my safety as a key concern, that I not a target because I am easily identified as not a Mexican, and convince me to come to Mexico.

Because if people would believe you then this could be one of the biggest transfers of wealth from one country to another where the people from the north come to the south, buy houses, invest in Mexico, and more important, we could all be together and maybe be something different, something is less brown and white, something more tan.